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Find our analysis on legislation, regulations, MedPAC meetings, and more. 

The Weekly Update, September 11

Good morning from Washington where we hope you are off to a great start for the week. Today marks the 22nd anniversary of the September 11, 2001 terrorist attacks where nearly 3,000 lives were claimed. Many Americans will take a moment to reflect on the events which transpired on that day. Efforts continue to this day to recover the remains of unidentified victims. Never forget the lives lost.

In other events, Novak Djokovic won his 24th grand slam singles event by winning the US Open. However, the real story was the 19-year-old American Coco Gauff winning the women’s singles drawing praise from world leaders and celebrities alike. I can tell you who did not draw praise, my New York football Giants as they lost last night in their season opener to the Cowboys 40-0. I am hoping things will get better – something I am sure Speaker McCarthy is telling himself as the House returns to session today with a government shutdown looming. He is facing tough opposition from the Freedom Caucus, as previously reported and right now a government shutdown is on the horizon! Welcome to the Week Ahead!

The Administration

The White House wants a $40 billion supplemental budget request with $24 billion for Ukraine and $16 billion for disaster relief for Hawaii, Florida, and Vermont, among others. The supplemental request is sure to be met differently by the House than the Senate. Speaker McCarthy may try to include the disaster relief funding portion and send that along to the Senate, where it will be sent back to him with the Ukraine money included. The Administration also wants $3.7 billion to be included in a continuing resolution (CR) for the Centers for Medicare and Medicaid Services (CMS) to assist with eligibility verifications of Medicaid and marketplace programs. With millions set to lose coverage in states as pandemic funding erodes, the Administration and several states are working to ensure eligibility verifications across the country. A government shutdown would still allow essential services to run, and the exchanges would remain open. If a shutdown occurs, HHS expects to furlough 40 percent of its employees, but those staff who work on Medicare, Medicaid, and other mandatory programs will still work.

The Senate

In contrast to the House, the Senate continues to work in bipartisan fashion on appropriations. The Senate will likely vote on a “minibus” for MilCon-Agriculture-Transportation/HUD on Wednesday following a procedural vote tomorrow.  The Senate will give the Biden nominee to head up the National Institutes of Health a hearing in October. The Senate HELP Committee chair, Bernie Sanders (I-Vt.), lifted the hold after expressing concerns that President Biden needed to do more to lower drug prices. Senator Sanders had the hold on since spring, but he feels better considering recent actions taken by HHS and a White House commitment to continue the fight on lowering the price of prescription drugs.

Majority Leader Schumer will move forward with his briefing sessions on cybersecurity and artificial intelligence (AI) hosting the leaders of Meta, Alphabet, and Tesla among others. Leader Schumer wants senators to get smart quickly on the use of AI in a variety of contexts, as reports have already come out on China using AI to spread disinformation for the upcoming 2024 elections. The Senate will begin hearings on the various uses of AI this week.

The House

The Energy and Commerce Health Subcommittee will host a hearing entitled, “Legislative Proposals to Prevent and Respond to Generic Drug Shortages” on 9/14 at 10 am to debate 5 bills. This is a follow up to a Chair Rodgers (R-Wa.) RFP on the topic in August and has been a somewhat bipartisan topic of concern this year. Rodgers’s angle will be about the shortage of cancer drugs and the ingredients in generic drugs that are not readily available. Ranking Member Pallone (D-Nj.) will probably discuss his disdain for the drug industry and practices that he sees as anticompetitive and counter to patient safety.

The Ways and Means Committee will have a Member Day on 9/14 at 9 am. This is the first such member day and comes after months of grumbling about the issue from down dais members, who do not believe that the Committee is doing enough legislatively. The Committee has essentially cleared its health agenda after approving bills related to price transparency, PBM regulations and hospital consolidation. Members will have an opportunity to publicly express their concerns.

Government Funding

With only limited time remaining, we remain on course for a government shutdown. Speaker McCarthy is not receiving cooperation from the Freedom Caucus whose members have openly expressed their willingness to shutdown the government. The Speaker knows a shutdown could be perilous for Republicans headed into the 2024 election. Supporters and detractors of the Speaker have expressed their willingness to shut down the government unless an impeachment vote on President Biden occurs. Moderate Republicans feel not enough evidence exists for such a vote and want to move forward with the Speaker in passing a CR that gets us into November.

Create a great week!

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What Happened, What You Missed: September 4-8, 2023

Odds of Shutdown Grow as Appropriations Gridlock Continues

The White House is urging Congress to agree to a short-term continuing resolution (CR) to keep the federal government open after the current fiscal year (FY) ends on September 30. To date, only the House has advanced an appropriations bill for FY 2024, although the Senate is considering moving forward on a package of spending bills as soon as next week. However, with little time remaining for a bipartisan, bicameral FY 2024 spending agreement, the Senate appears to be signaling that the upper chamber will address the looming appropriations deadline with a bipartisan CR of their own. However, widespread disagreements over spending among Republicans in the GOP-controlled House make the path forward on a bicameral CR increasingly tenuous, which raises the odds for a government shutdown in just over three weeks.

Health Affairs: 32% of HHS Appointees Leave for Private Industry

About one in three political appointees at the Department of Health and Human Services move on to positions in the private industry, according to a study published in Health Affairs. The study examined HHS appointee exits across three presidential administrations from 2004 to 2020. While Republicans were more likely to appoint individuals to HHS from industry than Democrats, political appointees from both parties departed for industry jobs at similar rates. The study’s authors noted that the 32% does represent the true extent of transitions to the private sector, as some non-profit roles support commercial interests. According to the study, appointees’ departures to industry shouldn’t be surprising given higher compensation in the private sector.

Moderna: New COVID-19 Vaccine Effective against BA.2.86

Moderna’s new COVID-19 vaccine that’s set to become available this fall offers a strong immune response to the BA.2.86 Omicron subvariant, according to data published by the company. Moderna’s new vaccine was initially developed to target XBB.1.5, which was the most prevalent Omicron subvariant in early 2023. BA.2.86 has 34 to 36 different mutations in the spike protein compared with XBB.1.5, which has sparked concerns that the new subvariant could evade protection from new vaccines. Fortunately, according to Moderna, its new shot induces aan 8.7-fold increase in neutralizing antibodies against BA.2.86. Additionally, a trio of studies introduced in the past week suggest that BA.2.86 is not as infectious as previous subvariants.

New CMS Model Aims to Address Chronic Diseases

The Centers for Medicare and Medicaid Services (CMS) launched the States Advancing All-Payer Health Equity Approaches and Development Model (AHEAD) Model on Tuesday, which aims to partner with states to address chronic disease, behavioral health, and other medical conditions. Participating states will work with CMS to redesign health care delivery to improve the total by improving the quality and efficacy of care delivery and reducing health disparities. The AHEAD Model hopes to incentivize better health outcomes by providing hospitals with a prospective payment stream via hospital global budgets. The model also intends to boost coordination across payers, providers, and community organizations in participating states. A Notice of Funding Opportunity (NOFO) will be released in late fall 2023.

ICYMI: Most Americans Want Age Cap for President

Some 76% of Americans say there should be a limit for how old someone can be to serve as president, according to a poll from The Economist/YouGov. The poll comes amid growing questions about the age and health of US politicians. For example, 81-year-old Senate Republican Leader Mitch McConnell (R-KY) recently froze up at a press conference, while 90-year-old Sen. Dianne Feinstein (D-CA) did not appear in the Senate for several months due to shingles and other health issues.

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MedPAC Opens Annual Cycle Discussing Medicare Solvency and Improvements to Medicare Advantage Plans

On September 7-8, 2023, the Medicare Payment Advisory Commission (MedPAC) held the first meeting of their annual cycleThe Commission discussed payment adequacy and Medicare Advantage plans, ASCs, and Hospital at Home.

The Weekly Update 9/5/2023

Good morning, everyone!  We hope you enjoyed the Labor Day weekend and were able to find some time to relax. Your author enjoyed the closing of his community pool and the kids returning to school. Speaking of which, much like my fantasy football draft this week, the Senate returns to action today and is in session, while the House returns next week. The upper chamber has not cast a vote in 40 days. With much to do in the remaining days of September, the countdown on a government shutdown continues. In other news, the First Lady has tested positive for COVID under the new variant BA.2.86 – which I believe is close to a name of a Stars Wars droid. So far President Biden tested negative. With the Senate moving forward on appropriations and the House returning next week…. Welcome to the Week Ahead!

The Administration

As we mentioned last week, the Administration named the first ten Part D drugs to be negotiated by Medicare in 2026 under the Inflation Reduction Act’s (IRA) Medicare Drug Negotiation Program. CMS stated these drugs represent over $50 billion in Part D gross prescription drug costs. The next step is for manufacturers of these drugs to enter negotiations with the Centers for Medicare and Medicaid Services (CMS). After the negotiations, CMS will publish the negotiated prices for the selected drugs no later than September 1, 2024. The negotiated prices will go into effect on January 1, 2026.

On September 1, CMS also released their anticipated proposed rule outlining nursing home staffing requirements. Among other requirements, according to CMS, the proposed rule consists of three core staffing proposals: 1) minimum nurse staffing standards of 0.55 hours per resident day (HPRD) for Registered Nurses (RNs) and 2.45 HPRD for Nurse Aides (NAs); 2) a requirement to have an RN onsite 24 hours a day, seven days a week; and 3) enhanced facility assessment requirements. There will be a 60-day comment period for the proposed rule. All comments must be submitted no later than November 6.

The Senate

The Senate is in session this week and looks to get into several legislative items this month. On Friday, Majority Leader Schumer sent a Dear Colleague Letter outlining his plans for the upper chamber in September. The Senate plans to lead the way in the government funding salvo by working on passage of a continuing resolution (CR) to fund the government. The hope is to bring to the floor noncontroversial appropriation bills this week to include Military Construction-VA, Transportation-HUD and Agriculture-FDA. On September 13, the Senate will begin its forums on understanding artificial intelligence (AI) by convening AI developers, advocates, researchers, and others. The forums plan to address the potential use of AI in a myriad of environments to include healthcare, among others. Other topics Schumer planned to address include in a bipartisan manner include lowering the cost of insulin and prescription drugs, online safety, aiding Ukraine, addressing rail safety, and artificial intelligence.

The House

The House remains out until Tuesday, September 12 but the Energy and Commerce Committee continues to work behind the scenes on informal PAHPA discussions with Senate HELP staff. The lack of a government funding agreement does mean that health legislation will have to be down the priority list for members and leadership in September. Energy and Commerce does have a lot of hearings and markups scheduled, which will cover the entire jurisdiction of the committee. Notable healthcare markups include one on drug shortages (9/14 at 10am), Medicare innovation (9/19 at 10am) and the Inflation Reduction Act (IRA) Implementation (9/20 at 2pm). More clarity on health bills will likely materialize once members return, so we will continue talking with staff and members and keep you apprised of information on pertinent items.

No further action has taken place with regards to the government funding intrigue in the House Republicans Caucus. The House and Senate remain at odds with timing for a potential CR as well as the likelihood of a government shutdown.  Please stay tuned as the story continues to develop!

Create a great week!

What Happened, What You Missed: July 24-28, 2023

Odds of Shutdown Grow as Appropriations Gridlock Continues

The White House is urging Congress to agree to a short-term continuing resolution (CR) to keep the federal government open after the current fiscal year (FY) ends on September 30. To date, only the House has advanced an appropriations bill for FY 2024, although the Senate is considering moving forward on a package of spending bills as soon as next week. However, with little time remaining for a bipartisan, bicameral FY 2024 spending agreement, the Senate appears to be signaling that the upper chamber will address the looming appropriations deadline with a bipartisan CR of their own. However, widespread disagreements over spending among Republicans in the GOP-controlled House make the path forward on a bicameral CR increasingly tenuous, which raises the odds for a government shutdown in just over three weeks.

Health Affairs: 32% of HHS Appointees Leave for Private Industry

About one in three political appointees at the Department of Health and Human Services move on to positions in the private industry, according to a study published in Health Affairs. The study examined HHS appointee exits across three presidential administrations from 2004 to 2020. While Republicans were more likely to appoint individuals to HHS from industry than Democrats, political appointees from both parties departed for industry jobs at similar rates. The study’s authors noted that the 32% does represent the true extent of transitions to the private sector, as some non-profit roles support commercial interests. According to the study, appointees’ departures to industry shouldn’t be surprising given higher compensation in the private sector.

Moderna: New COVID-19 Vaccine Effective against BA.2.86

Moderna’s new COVID-19 vaccine that’s set to become available this fall offers a strong immune response to the BA.2.86 Omicron subvariant, according to data published by the company. Moderna’s new vaccine was initially developed to target XBB.1.5, which was the most prevalent Omicron subvariant in early 2023. BA.2.86 has 34 to 36 different mutations in the spike protein compared with XBB.1.5, which has sparked concerns that the new subvariant could evade protection from new vaccines. Fortunately, according to Moderna, its new shot induces aan 8.7-fold increase in neutralizing antibodies against BA.2.86. Additionally, a trio of studies introduced in the past week suggest that BA.2.86 is not as infectious as previous subvariants.

New CMS Model Aims to Address Chronic Diseases

The Centers for Medicare and Medicaid Services (CMS) launched the States Advancing All-Payer Health Equity Approaches and Development Model (AHEAD) Model on Tuesday, which aims to partner with states to address chronic disease, behavioral health, and other medical conditions. Participating states will work with CMS to redesign health care delivery to improve the total by improving the quality and efficacy of care delivery and reducing health disparities. The AHEAD Model hopes to incentivize better health outcomes by providing hospitals with a prospective payment stream via hospital global budgets. The model also intends to boost coordination across payers, providers, and community organizations in participating states. (https://flooringoutletandmore.com/) A Notice of Funding Opportunity (NOFO) will be released in late fall 2023.

ICYMI: Most Americans Want Age Cap for President

Some 76% of Americans say there should be a limit for how old someone can be to serve as president, according to a poll from The Economist/YouGov. The poll comes amid growing questions about the age and health of US politicians. For example, 81-year-old Senate Republican Leader Mitch McConnell (R-KY) recently froze up at a press conference, while 90-year-old Sen. Dianne Feinstein (D-CA) did not appear in the Senate for several months due to shingles and other health issues.

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